Shiba Inu price has pulled back in the past few days, mirroring the performance of Bitcoin and other altcoins. It slumped to a low of $0.0000083, down sharply from the year-to-date high of $0.000010. Still, the token may be on the verge of a strong bullish breakout despite the ongoing woes in the Shibarium network.
Shiba Inu Price Technical Analysis Points to a Rebound
The daily timeframe chart shows that SHIB price has pulled back in the past few days as sentiment in the crypto market has worsened.
This chart shows that the token has formed q giant falling wedge pattern, which is made up of two descending and converging trendlines. This pattern is usually rare and is one of the most common bullish reversal signs in technical analysis.
The ongoing SHIB price retreat is a sign that it is attempting to retest the upper side of the wedge chart pattern. A break-and-retest is one of the most common bullish continuation patterns in technical analysis.
The other bullish catalyst is that the token has remained above the Supertrend indicator, which is green in color. In most cases, this pattern often leads to more gains over time.
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Therefore, the most likely scenario is where Shiba Inu Coin price rebounds in the coming days. If this happens, the initial target will be at $0.00001020, its highest level this year.
A move above that price will point to more gains, potentially to the key resistance level at $0.000014, which is about 75% above the current level.
On the other hand, a drop below last year’s low of $0.0000068 will invalidate the bullish outlook.
SHIB to Rebound Despite the Ongoing Shibarium Woes
Shiba Inu has some potential bullish catalysts, including the ongoing decline of tokens in exchanges. It has tumbled to the lowest level in months.
At the same time, the coin will likely benefit from the potential crypto market bull run as odds of more interest rate cuts by the Federal Reserve rise this year. Besides, recent data shows that inflation is falling, while the labor market has softened. Meme coins like Shiba Inu thrive in an era of low interest rates.
However, the main risk is that Shibarium, its layer-2 network, has flopped, with its total value locked (TVL) in the ecosystem falling by 57% in the last 30 days to just $757km. This is an insignificant amount considering other layer-2 networks like Base, Polygon, and Arbitrum have billions of dollars in assets.
Shibarium’s success would have been beneficial to SHIB price because its fees, which is in the form of BONE, is normally converted into SHIB and burned. Today, only an insignificant amount of SHIB tokens are burned using this approach.
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